In this age of Covid-19 (to address the 10 attogram virus in the room), we’re all being advised to maintain social distance. Until this shakes out, living in high-density cities isn’t as appealing as it was a few weeks ago or — hopefully — as it will again sometime this year. But even before it became a public health issue, many Millennials had already discovered the appeal of moving to a place where they could spread out a bit. While this blog tends to focus on what drives young adults to favor one urban area over another, it’s important to understand why so many have chosen None of the Above, USA.
A reality, not a trend
The appeal of rural life might be underscored by the current, palpable fear of contagion, but is completely independent of it. We’ve seen articles on Millennials moving out to the country since at least 2017, and they almost certainly predate that. And even The PBS NewsHour has reported on this topic.
According to an EY study, young adults are almost as likely to buy a home in the sticks than in the city. The report suggests that, while 31% of Millennials still gravitate toward urban centers when it comes time to buy a home, 26% choose a small town or rural community.
(The report also notes that, between 2016 and 2018, the proportion owning their own homes rose from 26% to 40% while those living with their parents dropped from 30% to 16%. The 43% figure for renters remained constant.)
And the reason is pretty much what you’d expect: money.
“A renter household in an urban area earning the median U.S. household income should expect to pay 36.8 percent of their income on rent each month. In the suburbs, that falls to 31.8 percent; and in rural areas to 23.9 percent,” according to Zillow senior economist Sarah Mikhitarian. “A home buyer looking to purchase the median-valued home in an urban area should expect to pay 26.5 percent of their income on a mortgage payment each month. In the suburbs and rural areas, that falls to 20.2 percent and 13.4 percent, respectively.”
One consistent theme among sources for this post indicates that student loan debt affects the cash flows of Millennials far more than it did those of previous generations.
But what’s the appeal?
According to one report, starting a business is easier in a small town.
“Larger cities have very saturated job markets, especially when it comes to businesses pertaining to the interests of millennials. 30-somethings are finding that in smaller towns, there are more opportunities to open businesses of their own, ”blogger Jonathan West writes in SpareFoot. “Moving to a more rural area affords you the luxury of lax regulation, cheaper real estate, and less job saturation so you can more easily get your business up and running.”